If Arizona fires Sean Miller, vague contract language could cost it millions
Arizona coach Sean Miller’s seat is hotter than any in college basketball. Miller’s direct dealings with Christian Dawkins, a key figure in the FBI’s probe of the sport, were reportedly intercepted via wiretap. Miller won’t coach Saturday night against Oregon, and there would appear to be a chance he won’t coach at Arizona beyond this year.
And if he doesn’t – that is, if he were to be fired with cause – he could earn twice as much money from Arizona as he would if he were fired without cause.
That, at least, is how several reporters are interpreting some vague language in Miller’s contract. ESPN’s Darren Rovell first pointed out the possibility:
JUST IN: Sean Miller’s contract, as written, somehow pays him more for getting fired with cause than without cause. So if Miller is fired with cause, Arizona will owe him approximately $5 million more ($10.3 million versus $5.15 million) than if they fired for no reason.
— Darren Rovell (@darrenrovell) February 24, 2018
Darren Heitner of Forbes came to a similar conclusion. “Miller may be entitled to 85% of the money still due under his contract, or $10.3 million,” if he were fired with cause, Heitner wrote, as opposed to roughly 50 percent of that – $5.15 million – if he were fired without cause.
That interpretation can certainly be disputed, though. Here’s the exact wording of the relevant portion of the contract (which can be found in full here):
In the event of a termination [with cause], the University’s sole obligation to Coach shall be payment of his Base Salary as provided in Section III.
Section III defines “Base Salary” as the “total of his Program Salary and Peripheral Duties Compensation as set forth below.”
The same section then defines “Program Salary” as “a salary of ONE MILLION FOUR HUNDRED THOUSAND ($1,400,000) DOLLARS per annum.” It later sets out annual increases for the salary, by $100,000 every year until the penultimate year.
And finally, it defines “Peripheral Duties Compensation as “compensation of SEVEN HUNDRED THOUSAND ($700,000) DOLLARS per annum.”
“Base Salary,” therefore, is “the total of” $1,400,000 per annum and $700,000 per annum. The question is whether the “termination with cause” section, which refers to the “payment of his Base Salary,” means the total value of the contract or one year’s salary.
The “termination without cause” section is far more specific:
“The University shall pay to Coach as liquidated damages, in lieu of any and all other legal remedies or equitable relief, an amount calculated as follows for each year or pro rata portion remaining under this [contract]: fifty percent (50%) of that portion of Coach’s Base Salary (Program Salary plus Peripheral Duties Compensation) what would have been owed to him through the remaining period of this [contract] as provided in Section I but for termination under this Section, plus any Additional Compensation earned by Coach under Section IV prior to the date of termination.”
The difference in language is stark, which would seem to suggest the school intended the “with cause” pay to be equal to one year of Miller’s salary – roughly $2.3 million – rather than the total of all years on the contract. And that’s likely what the school would argue – if it were to fire Miller, and if the language were to be disputed.
But Forbes’ Heitner, who is an expert on this stuff, thinks that argument might be knocked back:
There is clearly missing language that should limit Miller’s salary in an instance where he is fired for cause — language that is present in almost every kind of employment contract.
The way that the contract is drafted makes it seem that the university would actually save money by terminating Miller without cause (only being required to remit 50% of Miller’s Base Salary still due), which makes no sense whatsoever. But the school may be trapped based on its poor drafting and/or review of the terms prior to the agreement’s execution.
